Bank of America Merrill Lynch India – Co. stated that it expects a 25 basis point or 0.25 percent cut in benchmark rates at the RBI policy meet tomorrow. Thereafter, the RBI would hang onto rates until December 2012 and cut rates by another 75 basis points in March 2013.
The investment bank expects GDP growth to be below RBI’s target of 7.3 percent on account of the effect of a suboptimal monsoon. Core Inflation, which is expected to hover around 5 percent, while main inflation could rise to 8 – 9 percent on account of higher food prices and diesel prices. (Moneycontrol)
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